Monday, October 23, 2006

Selective Mining in Orhaneli

Today I would like to tell you about our trip to Orhaneli Coal mine On 24th February 2000 Thursday

together with Mr. Clark A. Moseley from The North American Coal Corporation of USA, and Mine Field Manager of Orhaneli coal mine, Turkish Coal Board (TKI).

We arrived to Coal mine at about 1130AM. First we visited the coalmine. Minefield had a recent spoil landslide the week before. They also had an underground water flood on top of clean coal seam.

We have been advised that coalmine operation was stopped at that time due to landslide and flood. They said that they hope to start soon since they have not sufficient coal reserves in the coal-blending yard.

Thermal Power Plant had also limited coal stock for the next 2 months which is very critical for nonstop operation and electricity generation.

We then visited the engine repair shops, visualized engine overhaul activities. We visited warehouse. We noticed that they have a lean (short) stock compared to other Turkish Coal Board coalmine operations.

The following issues were discussed in this meeting:

1. Orhaneli Mine Management has 27 each Caterpillar (777) and 13 each Komatsu (HD785) trucks. They all have 85 short ton capacities. 11 trucks had serious engine problems.

2. Coal Mine Management had direct purchasing authority to place order not to exceed 120 billion TL per each purchase.

3. Their close proximity to Istanbul helps to speed up the spare parts emergency purchasing and warehouse stock.

4. New overburden removal activity would be tendered shortly. Current (year 2000) subcontract price was 550,000 TL per m3 overburden.

5. Turkish Coal Board had internal meetings in Ankara. TOR scheme was expected to take some time. Therefore Turkish Coal Board upper management gave new direction to mine management to make necessary overburden removal activity. They plan to remove 15 million tons of overburden in near future.

6. They had typical shovel breakdowns during coal operation.

7. Gumuspinar major coalmine was inspected on the map. Coal seam extension lies from north to south.

8. Nearby Dundar village would be relocated at a later stage of overburden removal.

9. We collected necessary coal production figures of the past years, we reviewed the available drawings, charts, figures, datas etc.

Preliminary observations and Recommendations

After visit to mine field, Mr. C.A.Moseley pointed out following important items,

1. In USA in a similar brown coal open pit surface mining operation, even in worse weather and environmental conditions, they works non-stop, 365 days per year. Here in Orhaneli, in wintertime, administration stops working in the coal field completely

2. In USA they have enough number of discharge water pumps to avoid any underground water flood. In the USA, they always keep spare engine to replace any engine breakdown. All their trucks are available and in full operation at all times. It is not normal practise to keep 11 (eleven) engines in repair shop.

3. He advised that in their US coalmines their average price is between 0.80-1.25 USD per Mmbtu, whereby here in Orhaneli Administration charges local Turkish ELECTRICITY GENERATION PUBLIC COMPANY approximately 3.00 USD per Mmbtu. Fuel Cost could be reduced to initial feasibility figure (8.97 USD per ton) but that needs effort and dedication.

4. In surface mining there is no need water washing of the coal for stone (incombustible) separation. All we need is dedication for careful work, commitment and training of the employees.

5. That is to say, “Selective Mining” procedures must be applied urgently.

6. He recommended that they might invite coalmine manager(s) to their sites in USA to help them to educate how they should work. This may take place sometime prior to coal mine transfer, provided that the future investor pays necessary traveling and living expenses.

Mr. C.A. Woseley advised that North American Coal Corporation desired not get involved in Thermal Power Plant third party due diligence consultancy works since they are not in core coal consultancy business.

There are many lessons-learnt in above trip report for all parties concerned.

“Selective Mining” procedures are to be applied in all our coal mining fields.

Privatisation is a good opportunity for better operation of the coal mines,
however it should be carefully monitored,

Local public R&D funds are to be spent for this purpose to develop local engineering

We should get control over our coal mines and power plants to operate properly, apply “Selective Mining” procedures, make necessary design and operation procedure changes by ourselves,

We should support our local companies to handle all design and operational work for upgrading, and we need to learn from our past experience.


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